TMO Reports - Inside Apple vs. Beatles Hearing, Focus On Where To Hear Case

by , 6:30 PM EST, February 25th, 2004

In a preliminary hearing before a British court Wednesday, Apple Computer asked that a lawsuit over the use of the Apple name on its iTunes music service brought by Beatles recording company, Apple Corps Ltd. , be moved to a California court and not be heard in England. Lawyers for the record label will state their case before the High Court Thursday.

London-based Apple Corps, owned by Sir Paul McCartney, Ringo Starr and the widows of John Lennon and George Harrison, is suing Apple Computer for allegedly breaching the terms of a 1991 agreement. Apple Corps claims Apple Computer broke the terms of the agreement when it used the Apple name and logo to promote music products on its online iTunes music store. Apple contends that under the agreement, it was granted exclusive rights to use the name in relation to data transmission services, which would include the iTunes service.

In the first day of what is expected to be a three-day hearing, lawyers for Apple Computer argued that because at present its iTunes service is only available in the US, and because a similar lawsuit by Apple Corps is already being dealt with in San Francisco, Calif., the case should be heard in the US and not Great Britain.

"This is purely a question of jurisdiction at this point," Mike Taylor, a court reporter for the British Press Association, who was in the court room during Wednesday's proceedings, told The Mac Observer. "The attorney for Apple Computer, Lord Grabiner QC, said he was 'completely in the dark about the reasons Apple Corps wanted to move this case.'"

Lord Grabiner accused Apple Corps of "attempting to frustrate our position or business conduct or to extract money from us because of the success and innovative qualities of our product."

Mr. Taylor said that under British law, Apple Computer was given one court session to state its case and that Apple Corps will make its arguments Thursday. "Apple Corps will argue that the trial should be in Britain," he said.

Mr. Taylor said he believes a judge's decision on jurisdiction will come "in the next few weeks."

"Justice Mann will reserve a decision to a later date," Mr. Taylor commented. "I doubt very seriously a decision will be made at the end of day three directly from the bench. There is a lot of law involved here and a decision will not come straight away."

Mr. Taylor cautioned that whatever the outcome, the jurisdictional decision is expected to be appealed to a higher court. "If it is appealed, it could be held up in the courts for some time."

In an opening volley of light talk, the judge hearing the jurisdictional issue revealed he owns an Apple iPod and asked the lawyers if that revelation disqualified him from hearing the case. Lord Grabiner QC said he was delighted to hear Justice Mann had an iPod and added, "We would perhaps have sent you one free if that would not have been improper."

Neither the plaintiffs of defendants had any objections to the judge's concerns.